The author is a Forbes contributor. The opinions expressed are those of the writer.

Loading ...

Loading ...

This story appears in the {{article.article.magazine.pretty_date}} issue of {{article.article.magazine.pubName}}. Subscribe

Hong Kong is a city that was made from scratch. But is it giving new-economy tech startups the backing they need?

Founders of the 10 new startups selected by Blueprint gather around the break table – a former wing from a Cathay Pacific plane. (Photo: Blueprint)

Pretty much everyone in Hong Kong is an immigrant if you go back a generation or two. Rags-to-riches stories such as that of Li Ka-shing, who rose from the factory floor to become Asia’s richest man, are the stuffing behind the fabric of the city. Plus there’s the world’s factory on the doorstep. If you can make it anywhere, you can make it here.

But many people, entrepreneurs included, fault Hong Kong for its lack of a startup culture. The city every year rates as the freest economy in the world, in the eyes of the Heritage Foundation. But to get anywhere as a startup in the new economy, many entrepreneurs end up heading to Silicon Valley for venture-capital investment, and funding at the Series A stage and beyond. They also find California the perfect petri dish to find mentors and to cultivate talent.

Is that about to change? The founders of the latest round of tech startups say it already has. They say that the promise of tapping the vast markets in China and the rest of Asia far outweigh the distance between them and Silicon Valley. And for the first time, the ecosystem necessary to foster the growth of fledgling companies is starting to appear.

“This is the absolute best place in the world to run a startup,” Alex Man, the co-founder of e-commerce data-analysis site 29th Century, said. While Hong Kongers may lack the soft skills needed to thrive at a startup, they have “amazing technical backgrounds,” meaning they hit the ground running. “It’s much easier to teach them the business side than to get a business person and teach them the technical side.”

Asia, and particularly China, is rapidly moving up the food chain from basic manufacturing to high-end components. The fast-growing middle class and their businesses all require services, more and more of them. “The main draw is this is where our customers come from,” Man at 29th Century said.

His company is one of a fresh batch of 10 startups that recently won backing from Blueprint, an accelerator funded by the Swire Group. Swire is the conglomerate that is the parent company of Hong Kong’s flagship carrier, Cathay Pacific, and its holding company , as well as one of the city’s most-prominent developers and landlords, Swire Properties. Blueprint is one of the few initiatives in Hong Kong that goes beyond offering flexible workspace for rent, and gets involved in the development of the company.

At Blueprint, the chosen few receive six months of rent-free workspace – and, more importantly, six months of mentorship as well. The accelerator’s long list of mentors includes local advisers on legal issues, as well as representatives from “unicorn startups” such as Net-A-Porter, Uber and Tesla. There is also a smattering of executives from the Swire Group, which does its best to find a way to find work within the conglomerate for the startups, for instance through a pilot project.

Part of the guidance comes from two of the most-influential venture-capital firms for tech startups: Seedcamp and 500 Startups. Both visit Blueprint for a week. Seedcamp arrives early and, after hearing pitches from the startups, gives them feedback on their approach, as well as practical advice on their business models. The 500 Startups guidance comes later in the program and focuses on sales and marketing, customer acquisition and growth hacking. Typically the startups have the opportunity to indicate if they would like to go under consideration by both VC firms for investment.